Zomato, the food delivery parent behind BlinkIt, District, Hyperpure and Zomato apps, reported its quarterly numbers for Q3 of FY 2024-25. And while overall numbers have largely increased across expected lines (barring QoQ EBITDA which was negative), the company stated it is still losing significant money on BlinkIt expansion. This comes as competition in the quick commerce space is heating up from all quarters, such as Zepto, Flipkart, Amazon and its listed food delivery peer, Swiggy.
Talking about pure numbers, gross order value (GOV) for the entirety of its B2C apps grew 57% YoY (14% QoQ) to INR 20,206 crore cumulatively in Q3FY25. Of this, food delivery GOV grew 17% YoY (2% QoQ), Quick commerce GOV grew 120% YoY (27% QoQ), and Going-out GOV (District app) grew 191% YoY (35% QoQ). The District numbers obviously see an impact from Zomato’s acquisition of Paytm’s events and ticketing business.
The company’s B2B business Hyperpure’s Revenue grew 95% YoY (13% QoQ). Zomato’s stock traded over 7% down today, as reports of the company reporting potential loses on quick commerce came up.
At a consolidated level, revenue grew 58% YoY (12% QoQ) to ₹5,746 crore. On the profitability front, consolidated Adjusted EBITDA grew 128% YoY to ₹285 crore in Q3FY25, largely driven by improvement in food delivery Adjusted EBITDA margin (as a % of GOV) to 4.3% compared to 3.0% a year ago. However, on a QoQ basis, consolidated Adjusted EBITDA declined by 14% (or ₹45 crore) despite the improvement in food delivery margins. Zomato says it is largely due to accelerated investments in expanding the quick commerce store network, where quarterly losses increased by ₹95 crore QoQ.
While most numbers across businesses remained along expected lines, it is the continued loss on quick commerce vertical BlinkIt, which might stand out. The venture incurred losses of ₹103 crore, much against an earlier guidance wherein Zomato had stated a near breakeven in Q3’25. “The losses in our quick commerce business this quarter are largely on account of pulling forward the growth investments in the business that we would have otherwise made in a staggered manner over the next few quarters. As of now, it seems like we will get to our target of 2,000 stores by Dec 2025, much earlier than our previous guidance of Dec 2026.”, said Zomato founder and CEO Deepinder Goyal.
This accelerated investment comes along the back of hyper-increased investment activity in the quick commerce space. BlinkIt’s rivals have been raising money at breakneck speed, which has perhaps pushed the company to speed up its own investments in the space to take on competition. While Zomato’s successful QIP raise of nearly $1Bn helped fund this expansion, the likes of Zepto, Swiggy Instamart, Amazon Tez, Flipkart Minutes and others have also been raising significant money to take on a rising quick commerce industry in India.
These investments and competition combined, have forced Zomato to change its earlier ‘near breakeven’ guidance to continued losses in the near future for BlinkIt. “As we continue to bring forward store expansion, our networks may have to carry a greater load of under-utilized stores which will impact near-term profits in the next one or two quarters. These investments will however also likely result in GOV growth remaining meaningfully above 100%, at least for FY25 and FY26.”, said BlinkIt head Albinder Dhindsa.
